Don't dump Amazon yet—VMware tries to keep expectations low.

VMware this morning confirmed that it will offer a public, infrastructure-as-a-service (IaaS) cloud to compete against the Amazons and Rackspaces of the world.

VMware has long straddled the line between helping service providers build clouds and actually offering a cloud of its own to IT shops. VMware's biggest previous foray in providing its own cloud was Cloud Foundry, a platform-as-a-service network to let customers build and host applications in VMware data centers.

The public cloud confirmed today by VMware marks the first time the company will become an IaaS provider itself, analysts said. Unlike platform-as-a-service, which puts the focus on providing simplified tools to application developers, IaaS clouds let customers (or require them to) manage the underlying infrastructure such as the operating system and virtualization tools.

VMware CEO Pat Gelsinger, COO Carl Eschenbach, and other top executives have publicly derided Amazon, saying that VMware and its partners shouldn't be beaten by a "company that sells books." (Amazon CTO Werner Vogels responded, "as long as people see us as a bookstore, we are fine.")

So it's not a surprise VMware is taking on the "bookseller" more directly.

VMware's cloud—dubbed the "vCloud Hybrid Service"—will be a bit different from Amazon's model. VMware will primarily sell space in the cloud to customers through its existing cadre of "value added resellers" and systems integrators. The "hybrid" cloud moniker indicates that customers should maintain on-premises deployments and keep using VMware's virtualization and cloud management software.

VMware is hedging its bets by also offering the cloud directly to developers and other customers with nothing more than a credit card, according to Forrester analyst James Staten.

Details are vague by design

Curiously, VMware is being vague in how it describes its new offering, perhaps to avoid the perception that it is trying to compete against its own partners. It was briefly mentioned in an investor event this morning, and it was alluded to in a press release. VMware also accidentally confirmed it last week when a quickly deleted tweet said, "VMware is prepping a vCloud based public cloud service!"

Analysts were briefed on the announcement ahead of time. Staten of Forrester explained what's going on in a blog post:

VMware's public cloud service—yep, a full public IaaS cloud meant to compete with Amazon Web Services, IBM SmartCloud Enterprise, HP Cloud, Rackspace and others—won't be fully unveiled until Q2 2013, so much of the details about the service remain under wraps. VMware hired the former president for Savvis Cloud, Bill Fathers, to run this new offering and said it was a top three initiative for the company and thus would be getting "the level of investment appropriate to that priority and to capitalize on a $14B market opportunity," according to Matthew Lodge, VP of Cloud Services Product Marketing and Management for VMware who spoke to us Tuesday about the pending announcement.

VMware is calling the service "hybrid" to set expectations about how enterprises should view the solution and to reinforce its claims about vCloud Director, the software upon which this offering is based. The company has long claimed that vCloud Director, which instantiates an IaaS environment, empowers I&O professionals to manage workloads in exactly the same way, with the same vCenter tools whether deployed on-premise or in the cloud. Prior to this announcement VMware was delivering this hybrid value through Internet service providers (ISPs) who carried the vCloud Powered or vCloud DataCenter monikers which required them to expose the full vCloud API to enable this level of consistent control. However, it found a reluctant partner reception as ISPs feared full vCloud implementation would commodize their offering and limit differentiation (and even more ISPs balked at the VMware licensing costs compared to open source alternatives).

The second reason for the "hybrid" name is to prove to its army of VMware Certified Professionals that the public cloud isn't the enemy but is instead an extension of the data center [and] one that is different from the static virtualization environments they operate today. This means showing them how vCloud Director should really be deployed—with a self-service portal exposed to the developer (not to the administrator), with cost transparency and full deployment automation.

VMware glossed over these details in today's press release. "Today VMware announced its plans to extend the software-defined data center with a hybrid cloud service offering that will allow its 480,000 customers to reap the benefits of the public cloud without changing their existing applications while using a common management, orchestration, networking, and security model," VMware said. "VMware expects to launch VMware vCloud Hybrid Service later this year and intends to make it available through its existing channel, working with its extensive partner ecosystem to accelerate customers’ journey to the cloud."

When we contacted VMware this morning, a company spokesperson said, "VMware does not have additional details to share about the service at this time beyond what is included in the press release."

Gartner analyst Chris Wolf provided more details in a blog post, writing, "If we look at today’s IaaS announcement, VMware is trying to have greater control of the 'choice' its customers get. Choice will mean a VMware-hosted offering that in theory will make it easy for customers to move VMware-based workloads in and out of the pubic cloud. The aim is an 'inside-out' approach where workloads between a private data center and a public cloud operate seamlessly. The trick here, however, is how important mobility and choice will be to customers. Workloads that go straight to cloud and have few traditional enterprise management needs can go to any cloud. Front end web servers are a great example—static data, built to horizontally scale, and no backup requirements."

VMware has to find some way to differentiate itself from Amazon, Wolf noted. "If VMware is the 'enterprise alternative' to Amazon, it better launch its IaaS solution with enterprise features (AWS isn’t perfect but it has tons of features that large enterprises are now taking for granted)," he wrote. "Redundant data centers, enterprise storage, networking, backup, and security are a must. In addition, it must offer serious tools for developers; the time for VMware to show the results of its investment in Puppet Labs should be when the public IaaS offering launches. Otherwise, Amazon and other providers will continue to win on features and the ease of experience that developers have on its platform. Granted, this can’t all happen overnight, but VMware needs to show value quickly in order to gain momentum."

Wolf also reports that a version of the Cloud Foundry software (which was spun out into a joint venture involving VMware and its owner, EMC) will be running on Amazon in a couple of months.

VMware takes on network virtualization too

In addition to the new cloud offering, VMware detailed a network virtualization initiative called NSX, developed in part with technology acquired in VMware's $1.26 billion purchase of network virtualization and software-defined networking vendor Nicira.

"VMware NSX exposes a complete suite of simplified logical networking elements and services including logical switches, routers, firewalls, load balancers, VPN, QoS, monitoring, and security; arranged in any topology with isolation and multi-tenancy through programmable APIs—deployed on top of any physical IP network fabric, resident with any compute hypervisor, connecting to any external network, and consumed by any cloud management platform (e.g. vCloud, OpenStack, CloudStack)," VMware said. Further details are on VMware's blog.

Promoted Comments

Seems to me that VMWares aproach is closer to Microsoft's Azure, with the run on the cloud and intranet aproach than Amazon's pure cloud aproach.

That's what I read it as too. Microsoft's big play so far with System Center has been that hybrid cloud story with the portability of moving a VM from On prem to the cloud in one motion. As much as I'm sure VM ware wants part of the cloud game, that may be the more interesting value prop for a lot of shops

25 Reader Comments

Most of the time I can pick a winner or loser pretty quickly, but I'm still up in the air on this one. Amazon has the financial resources to build the fabric out at a very quick pace and let it sit empty(unused). I'm not so sure VMware has the same resources. It seems to me they would have to pick up some business pretty quickly, while still keeping pace with the expanding business and fabric needs. After all, one business could need and potentially require all your resources at any one moment. I think it will be a fine line with VMware balancing growth with the ability to sustain the growth.

Yay for competition! I love AWS but it is simply too expensive for a dev on a shoestring budget. When/if these cloud providers start getting close to the price a colocated server at a datacenter can provide then I will be in heaven.

All the EMC owned companies have major issues. RSA products are some of the worst products I have ever demo'd, they don't get consistent updates, and look like something you would expect from the early 2000s. EMC companies appear to tend to try to lock customers in, instead of offering better products. I'm not sure specially after the price per virtual memory fiasco, that you will find many loyal VMware proponents left, I know I always look for other offerings this days before looking at VMware.

Seems to me that VMWares aproach is closer to Microsoft's Azure, with the run on the cloud and intranet aproach than Amazon's pure cloud aproach.

That's what I read it as too. Microsoft's big play so far with System Center has been that hybrid cloud story with the portability of moving a VM from On prem to the cloud in one motion. As much as I'm sure VM ware wants part of the cloud game, that may be the more interesting value prop for a lot of shops

VMware CEO Pat Gelsinger, COO Carl Eschenbach, and other top executives have publicly derided Amazon, saying that VMware and its partners shouldn't be beaten by a "company that sells books." (Amazon CTO Werner Vogels responded, "as long as people see us as a bookstore, we are fine.")

Because this is still being reported seriously, I again feel obligated to point that it is tongue in cheek.

Most of the time I can pick a winner or loser pretty quickly, but I'm still up in the air on this one. Amazon has the financial resources to build the fabric out at a very quick pace and let it sit empty(unused). I'm not so sure VMware has the same resources. It seems to me they would have to pick up some business pretty quickly, while still keeping pace with the expanding business and fabric needs. After all, one business could need and potentially require all your resources at any one moment. I think it will be a fine line with VMware balancing growth with the ability to sustain the growth.

Don't forget that VMware is "owned" by EMC. There is PLENTY of financial resources to build fabric out. And plenty of EMC equipment to build it on.

I doubt VMWare has a chance. With that said, is Amazon finally affordable now? Could I put a very minimal website up for $20/mo yet? Or is the low end still a game for other providers?

I can never make sense of their calculator, I have a tiny budget but I need to get my web server on the cloud.

I am using a micro EC2 instance with a free Debian/Nginx image from the market place and it is working brillantly. I am using the "free tier" so it is actually $0/yr but the calculator seemed to be telling me it would normaly be $15/mo. You can also use their reserved instance (pre-pay) for a discount on that. I am monitoring perfomance with Copperegg.com and it is performing better than my "acceptable quality" reseller level accounts.

Making sense of their system/payment has always been a hindrance to start using it for web serving but the free tier offer made that easier to swallow. Their portal is kind of baffleing imho but once up and running, it has all been simple.

Wrong move. You don't try to compete with a colossus like Amazon. You try to go where it can't (or wont)

I don't think they're trying to actually compete with Amazon at all. It sounds to me more like giving their existing lucrative customer base less reason to leave or investigate alternatives.

I think they are much more worried about existing customers setting up OpenStack or whatever MS offers internally and then using Rackspace, Dell, HP, IBM, Azure etc for hybrid clouds. Without their own hybrid cloud solution, they are vulnerable.

It could be that by talking up Amazon as a threat using snarky tongue and cheek 'bookseller' phrases, they are deliberately trying to deflect attention from who they are really worried about while at the same time getting plenty of press for their own plans. And they don't want to legitimise OpenStack or Azure by acknowledging them directly.

I doubt VMWare has a chance. With that said, is Amazon finally affordable now? Could I put a very minimal website up for $20/mo yet? Or is the low end still a game for other providers?

I can never make sense of their calculator, I have a tiny budget but I need to get my web server on the cloud.

If its a static blog yes, I use static Jekyl generated files hosted in s3 (http://www.techtraits.com/) My monthly bill is usually under $10. Admittedly I am not exactly getting millions of hits per day.

If you just have a minimal web site on a single server, all this IaaS cloud stuff will just overcomplicate things for you and possibly offer lower performance than a VPS would anyway.

IMO you'd be better off sticking with VPS hosting, or even shared hosting depending on your site and what it's built with.

I'm only starting simple, it won't be forever.

Also, isn't VPS the same thing?

You have either VPS, shared, or dedicated hosting.

Sort of but not really. There is some (growing) overlap though.

Cloud hosting is another level of hosting altogether. Even if it is built out of virtual servers that are well private

Traditionally VPS hosting was about having a fixed number of more permanent servers - you wanted them to be robust and have high uptimes.

Cloud hosting (at least how Amazon envisages it) is more about having a variable number of more disposable servers tied together with a bunch of other services. The number of servers can ramp up or down based on demand and are generally paid for by the hour.

It is best for scalable 'shared nothing' applications that have been architected for this kind of infrastructure. It also needs sophisticated monitoring and automated deployment and configuration management. You need to design everything around detecting failures and responding to them.

Initially AWS didn't even have persistent block storage on the EC2 instances. Shut em down and the filesystem went away for good. Now though you can provision persistent block devices for your servers - which means that you can treat them more like a traditional VPS.

If you only have a few permanent servers that need to stay up good VPS hosting can still be preferable. And a good VPS host will generally be able to offer better disk I/O performance than Amazon.

And to make it more confusing there are VPS hosting providers that call themselves 'cloud hosting'. These are an in between solution - they are permanent virtual servers (VPS style) backed by a SAN and live migration to prevent server failures taking your VPS down. These are generally more expensive than a standalone VPS though.

If you just have a minimal web site on a single server, all this IaaS cloud stuff will just overcomplicate things for you and possibly offer lower performance than a VPS would anyway.

IMO you'd be better off sticking with VPS hosting, or even shared hosting depending on your site and what it's built with.

I'm only starting simple, it won't be forever.

Also, isn't VPS the same thing?

You have either VPS, shared, or dedicated hosting.

Sort of but not really. There is some (growing) overlap though.

Cloud hosting is another level of hosting altogether. Even if it is built out of virtual servers that are well private

Traditionally VPS hosting was about having a fixed number of more permanent servers - you wanted them to be robust and have high uptimes.

Cloud hosting (at least how Amazon envisages it) is more about having a variable number of more disposable servers tied together with a bunch of other services. The number of servers can ramp up or down based on demand and are generally paid for by the hour.

It is best for scalable 'shared nothing' applications that have been architected for this kind of infrastructure. It also needs sophisticated monitoring and automated deployment and configuration management. You need to design everything around detecting failures and responding to them.

Initially AWS didn't even have persistent block storage on the EC2 instances. Shut em down and the filesystem went away for good. Now though you can provision persistent block devices for your servers - which means that you can treat them more like a traditional VPS.

If you only have a few permanent servers that need to stay up good VPS hosting can still be preferable. And a good VPS host will generally be able to offer better disk I/O performance than Amazon.

And to make it more confusing there are VPS hosting providers that call themselves 'cloud hosting'. These are an in between solution - they are permanent virtual servers (VPS style) backed by a SAN and live migration to prevent server failures taking your VPS down. These are generally more expensive than a standalone VPS though.

Hope that helps.

Interesting, AWS is more complex than I need at the moment although I have a few application ideas that could benefit from dynamic scaling. Personally, I'm thinking it would be simpler to just call both VPS and refer to AWS as VPS with auto scaling. Although I was already aware that most didn't have that feature. How does the pricing compare?

While the cloud wars continue, at the end of the day, the rhetoric does not change IT’s job description to support and drive business innovation. IT is focused on finding the systems and platforms that will support this goal as effectively and efficiently as possible. And while IaaS can be viewed as a stepping-stone in the process, smart businesses are not losing sight of the forest for the trees, keeping their eyes on the strategic endgame of accelerating IT-driven innovation by speeding application development and delivery.